Matthew Dornan, Australian National University;Ronald Sofe, Chris Banga and Carmen Voigt-Graf,

National Research Institute

Provincial Road Management in PNG

PNG Update Conference, UPNG, 3-4 November 2016

Research questions

“Papua New Guinea’s transport networks are failing. Majorroads, including the crucially important Highlands Highway,have deteriorated alarmingly, raising the costs and reducingthe availability of transport services. Most of the feeder roadsare frequently impassable. Communities… are becoming moreisolated because of deteriorating physical infrastructure. Thedilapidated state of infrastructure is largely the result ofinadequate maintenance and poor management over a longperiod… Almost half of national roads and two thirds ofprovincial roads need rehabilitation or reconstruction beforethey can be properly maintained.”

- PNG Government, 2013 Budget (vol 1)

Decentralisation

• 1977 Organic Law on Provincial Government

• 1995 Organic Law on Provincial and Local Level Government

• 2005 NEFC’s Cost of Services study – RIGFA established as a result

• 2012 Alotau Accord announces establishment of district development authorities

Spending performance on infrastructure maintenance

Source: NEFC, Provincial Expenditure Review 2012

Impact of Service Improvement Programs

Source: NEFC, Fiscal Report 2016

Example: Gulf Province FundingProvincial

govt revenue

Function grants(recurrent

expenditure)

DSIP

PSIP

LLGSIP

Lack of ownership/accountability

“MPs are passing the buck to one another.”– Provincial Administrator

“In Waigani, they think that cooperation is the norm. This is not happening in the province.”

“The provincial government plan says one plan, one budget, one account – all through coordination. But we currently have 3 plans, 3 budgets, and if you include the local level governments, 13 budgets, and 13 accounts.”

– Deputy Provincial Administrator

Funding

• Capital / recurrent expenditure not determined on the basis of need

• No coordination between level of capital and recurrent expenditure

Quality of spending

Quality of DSIP/PSIP spend variable

“In my opinion, DSIP/PSIP is a waste of money” – Provincial Administrator

“PSIP is not really helping us fund according to our plan. It is very hard to measure, or to justify, that (PSIP) expenditure against the plan the province has.”

– Provincial Engineer

Issues

• No ownership/accountability in responsibility for road management and is compounded by lack of coordination

• Capital vs recurrent expenditures; Funding not based on technical/economic assessment –political

• Lack of capacity for implementation– skills shortage (engineers), procurement.

Recent developments

• DSIP expenditure report provincial government

• Updating of ‘Determination of Service Delivery’ functions – key in specifiying responsibilities of provincial, district and local level govts

• DoW supporting DDAs

These are positive developments, although implementation will be tricky.

Conclusions